Sparkle, One of Many Firms in the Market for Toothpaste

question 193

Essay

Sparkle, one of many firms in the market for toothpaste, is in long-run equilibrium.Sparkle has a small market share and has been in business for a long time.
a.Identify the market structure in which Sparkle operates.Explain your answer.
b.What is Sparkle's profit or loss? Explain your answer.If you cannot determine the profit or loss, explain what information is missing.
c.Draw a diagram showing Sparkle's demand curve, marginal revenue curve, average total cost curve, and marginal cost curve.Label your diagram.

---

Definitions:

Interest Rate

The segment of a loan that is applied as interest to the borrower, frequently described as an annual percentage of the unsettled loan.

Future Amount

The value of an investment or loan at a specified time in the future, calculated by applying interest rates or growth factors.

Rate of Return

Rate of Return is the gain or loss of an investment over a specified period, expressed as a percentage of the investment's initial cost.

Investor

An individual or entity that commits capital with the expectation of receiving financial returns.